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COMPARATIVE ADVANTAGE: The ability to produced one good at a relatively lower opportunity cost than other goods. While pointy-headed economists developed this idea for nations, it's extremely important for people. A comparative advantage means that no matter how good (or bad) you are at producing stuff, there's always something that you're best (or least worst) at doing. Moreover, because you can produce this one thing by giving up less than what others give up, you can sell it or trade it to them. This idea of comparative advantage means that people and nations can benefit by specialization and exchange. You do what you do best, then trade to someone else for what they do best. Both sides in this trade get more and are thus better off after than before.
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THREE QUESTIONS OF ALLOCATION The three basic questions that an economy must answer because of limited resources and unlimited wants and needs are: What? How? and For Whom? The basic problem of scarcity requires every society to determine: What goods to produce? How to produce the goods? And who receives the goods that are produced?
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BLUE PLACIDOLA
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Today, you are likely to spend a great deal of time looking for the new strip mall out on the highway seeking to buy either a remote controlled train set or a genuine down-filled snow parka. Be on the lookout for the last item on a shelf.
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This isn't me! What am I?
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The portrait on the quarter is a more accurate likeness of George Washington than that on the dollar bill.
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"Posterity: you will never know how much it has cost my generation to preserve your freedom. I hope you will make good use of it. " -- John Quincy Adams, 6th U. S. president
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CSO
Central Statistical Office
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